Medical Billing Vocabulary Review

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Policyholder

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An individual who has contracted with an insurance company for coverage. Also known as the insured.

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Insurance Carrier

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A company that provides insurance coverage to individuals and/or groups.

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Premiums

Back 3

Payments made to an insurance carrier by a policyholder for coverage.

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HCFA 1500, Health Insurance Claim Form

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A universal health insurance claim form used by governmental health programs and many private insurance carriers.

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Coinsurance

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A type of insurance plan in which the patient is responsible for a percentage of the charges.

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Managed Care

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A type of insurance in which the insurance carrier is responsible for the financing and the delivery of healthcare.

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PPO or Preferred Provider Organization

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A type of managed care system in which patients pay fixed rates at regular intervals. A PPO is a network of health care providers who agree to perform services for plan members at discounted fees. Members may receive care from providers outside the network for a higher cost.

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HMO or Health Maintenance Organization

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A type of managed care system in which patients pay fixed rates at regular intervals. In HMO's, patients must choose from a specific group of physicians and hospitals for their medical care.

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Health Savings Account

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A plan which allows an employee to set up a tax free savings account to be used to pay for medical acceptable items until his high deductible is met. The high deductible must be at least $1000 but insurance is cheaper with that high a deductible.

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Capitation

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A type of managed care system in which patients pay fixed rates at regular intervals. The physician is paid a fixed amount per month to provide necessary, contracted services to patients who are plan members. The capitated rate is paid to the physician even if the physician does not provide any medical services to the patient during the time period covered the payment. Similarly, the physician receives the same capitated rate if a patient is treated more than once during the time period.

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Indemnity Plan

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An insurance plan in which the policyholders are reimbursed for healthcare costs. Under the indemnity paln the schedule of benefits in the policy lists the services that are covered and the amounts that are paid. The benefit may be for all or part of the charges. For example, the schedule of benefits may indicate the 80% of charges for surgery performed in hospital are covered. The policyholder is responsible for paying the 20%.

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Medicare

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A federal health plan that covers persons aged 65 and over, people with disabilities and dependent widow.

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Medicaid

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Health insurance cosponsored by federal and state governments for people of low income status.

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TRICARE

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A government program that covers medical expenses for dependents of active duty members of the uniformed services and for retired military personnel. Formerly known as CHAMPUS, it also covers dependents of military personnel who are killed while on active duty.

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CHAMPVA

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Insurance for veterans with permanent service-related disabilities and their dependents. It also covers surviving spouses and dependent children of veterans who died from service-related disabilities.

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Workers' Compensation

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People with job-related illnesses or injuries are covered under workers' compensation insurance. The benefits vary according to state law.

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Third Party Payer

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A term used to describe an insurance carrier in the context of the physician's and the patient's relationship.

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Schedule of Benefits

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In an insurance policy, a listing of services covered and the amount of coverage.

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Procedure

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Services performed by a provider.

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Procedure Code

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A standardized value that specifies which medical tests and procedures were performed. Listed in the CPT4 ("P" for procedure or what you did).

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CPT 4

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Current Procedure Terminology

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Diagnosis

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A physician's opinion of the nature of an illness or injury. Listed in the ICD-9-CM ("D" for diagnosis or why you did it).

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ICD-9CM

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International Clasification of Diseases

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Superbill

Back 24

A form listing procedures relevant to the specialty of a medical office, used to indicate what procedures were performed.

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Electronic Remittance Advice (ERA)/Explanation of Benefits (EOB)

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A document from an insurance carrier that lists the amount of a benefit and explains how it was determined.

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Accounting Cycle

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The flow of financial transactions in a business, from making a sale to collecting payment for the goods or services delivered. In a medical practice, this is the cycle from seeing and treating the patient to receiving payments for the services provided.

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Accounts Receivable (A/R)

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Monies that are flowing into a business.

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Day Sheet

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A report that lists all transactions for a single day. This report is pulled at the end of each office session. It must be balanced according to all charges and payments. To balance out a day, transactions listed on superbills (charges and payments) and totals from deposit tickets are compared against the computer-generated day sheet.

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Practice Analysis Report

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A report generated by the computer which summarizes the financial activity of the entire month. This report lists charges, payments, and adjustments and the total accounts receivable for the month. It is possible to balance out the month by taking all the day sheets for the month, totaling the charges, payments, and adjustments, and then comparing the totals to the amounts listed on the practice analysis report.

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Aging Reports

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A report which lists the outstanding balances owed to the practice by insurance companies or patients. This report can be used to perform cycle billing and insurance follow-up.

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Patient Statement

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A document that informs the patient of the amount owed to the medical practice.

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Walkout Receipt

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A document listing charges and payments that is given to a patient after an office visit. This document can also be sent into an insurance company for payment.

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Patient Data

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Personal information about the patient, as well as information on the patient's insurance coverage, is extracted from the programs patient database.

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Transaction Data

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Transaction information is taken from the superbill and keyed into the computer program. It included the date of the visit, diagnosis and procedure codes, lab work and payments made.

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Electronic Media Claim (EMC)

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An insurance claim that is sent by a computer over the telephone line using a modem.

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Electronic Funds Transfer (EFT)

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A system that transfers money electronically from one account to another.

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Clearinghouse

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A service bureau that collects electronic insurance claims, and forwards them to the appropriate insurance carrier. (WEBMd formerly NEIC)

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Audit/Edit Report

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A report from a clearinghouse that lists errors that need to be corrected before a claim can be submitted to the insurance carrier. This report needs to be examined and corrections made immediately to speed the processing and the payment of claims.

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Registration Form or Patient Information Form

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A document that contains personal, employment and medical insurance information about a patient.

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Coordination of Benefits -(COB)

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Consolidates all insurance coverage, identifies all health benefits and allows them to pay correctly.

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GPCI-Geographic Practice Cost Index

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Based on practice expense, malpractice and physician work.

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RBRVS- Resource Based Relative Value Scale

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The basis for the Medicare Fee Schedule utilizing a relative value unit for procedures, a GPCI value for area practice expense, malpractice, physician work and a conversion factor to reach a fee allowance

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RVU- Relative Value Unit

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The value placed on each procedure to use with the conversion factor to reach the Medicare Fee allowance.

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CF-Conversion Factor

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The value to multiply with the RVU to reach a dollar amount allowance for the fee schedule.

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Gatekeeper

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The term given to a primary care physician whose job is to coordinate the medical care of patients in managed care.

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Global Care

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A surgical "package" including the 24 hour period before surgery, the surgery day and a period of time after for billing purposes related to that surgery.

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CCI-Current Coding Initiative

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A listing of procedures that are "bundled" into one, items that are considerd an integral part of each other and therefore cannot be billed separately.

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ABN-Advanced Beneficiary Notice

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A statement specifically used by Medicare advising the patient that the procedure you wish to do may or may not be covered by Medicare. It is specific to time, date and particular service, it cannot be a general statement.

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Medical Necessity

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A medical biller must utilize the Highest Specific code, to the best of his knowledge, to support the claim he is billing out.

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UPIN-Unique Physician Identifying Number

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The number issued to a physician for billing purposes, a required number on all consultations, not to be confused with the physician's individual Identification Number issued by Medicare.

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OIG-Office of the Inspector General

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Guidelines for Fraud and Abuse including th "Work Plan", items the US Government are looking into carefully for illegal billing practices.